"Since its inception the Future Fund’s returns have grown to exceed the previous long-term target rate," said the Treasurer.

"But actuarial analysis indicates global investment market conditions may make it increasingly difficult for the Future Fund board of guardians to achieve current returns without taking on excessive risk."

The Future Fund has achieved returns of 7.7 per cent per annum since its establishment in 2006.

"The government supports the view that maximising returns must be balanced against the need to minimise the probability of losses to protect the taxpayer’s investment in the fund," Mr Morrison said.